10 Best Healthcare Stocks to Buy and Hold for 3 Years

In this article, we will be taking a look at the 10 Best Healthcare Stocks to Buy and Hold for 3 Years.

The first quarter of this year has seen a great deal of volatility in the equity markets. The S&P 500 fell into correction territory before rising again after first soaring to all-time highs. Concerns about high valuations, uncertainties about economic growth related to the Middle East conflict, and increasing inflation pressures brought on by rising energy prices have all contributed to this unrest. Following years of significant gains, investors have started to rotate out of large-cap technology equities.

John Stoltzfus, chief investment strategist at Oppenheimer, claims that rather than a total retreat from technology, this change represents a more comprehensive diversification plan. Rather, in order to balance exposure, investors are taking profits and moving wealth across sectors.

The healthcare industry, however, has found it difficult to gain from this rotation. The S&P 500 healthcare sector is down almost 4% for the year, while the overall index is flat, despite the fact that it is usually seen as a defensive move. Due to post-COVID earnings normalization and policy-related valuation pressures, this downturn has persisted over the last three years. Despite the fact that healthcare has trailed in earnings growth over the last five years, JPMorgan analysts believe things may be getting better, pointing out that recent stabilization and projections imply the worst may be behind us.

Increasing merger and acquisition activity is supporting improved fundamentals as companies look to strengthen their pipelines. In this context, low-priced healthcare penny stocks are gaining attention, particularly when they are backed by insider acquisitions. Insider purchases are frequently seen as strong indications, particularly in an industry where clinical data, market sentiment, and regulatory changes have a significant impact on stock performance.

This viewpoint is shared by institutional investors. Healthcare is highlighted as an appealing entry opportunity by strategies that emphasize substantial insider buying in addition to strong fundamentals, good earnings revisions, and innovative drug research. This opinion is supported by Deloitte’s February 16, 2026, Global Health Care Outlook, which depicts a struggling yet changing sector. Healthcare offers both short-term difficulty and attractive long-term growth potential, with over 70% of non-US executives anticipating increased revenues and profits and AI and digital tools gaining traction despite early adoption problems.

With that said, let’s look at the best healthcare stocks.

15 States with the Best Healthcare in the US

Our Methodology

For our methodology, we screened for stocks with at least 15% three-year EPS growth and positive upside potential. From this filtered list, we selected the top 10 stocks based on recent news and developments, ranking them in ascending order by the total number of hedge fund holdings as of Q4 2025, according to the Insider Monkey database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).

Here is our list of the 10 best healthcare stocks to buy and hold for 3 years.

10. Grifols, S.A. (NASDAQ:GRFS)

Number of Hedge Fund Holders: 15

Grifols, S.A. (NASDAQ:GRFS) is one of the best healthcare stocks on this list.

TheFly reported on April 2 that CBC News reported that Health Canada introduced new regulatory conditions on GRFS’ paid plasma collection centers nationwide after repeated inspection failures revealed ongoing operational issues. These included gaps in donor screening, inadequate staff training, and non-compliance with standard procedures. The measures will remain until the company demonstrates consistent adherence to regulatory requirements.

Separately, on April 13, Grifols, S.A. (NASDAQ:GRFS) announced plans to repurchase €500 million of its 7.5% senior secured notes maturing in 2030 as part of efforts to lower borrowing costs and reinforce its financial position. The move targets the reduction of its most expensive debt and aligns with broader refinancing initiatives. The company recently completed a strong loan syndication, including an expanded Term Loan B of about €3 billion and a $2 billion revolving credit facility, supported by institutional investors.

Following the expected completion of this refinancing, GRFS will not face significant debt maturities until late 2028. These actions are designed to decrease overall debt levels, reduce interest expenses, and improve the company’s debt timeline while preserving liquidity. The planned note redemption is contingent upon the closing of the new financing arrangements and the successful restructuring of debt obligations due in 2027.

Grifols, S.A. (NASDAQ:GRFS) is a global healthcare company specializing in plasma-derived therapies and transfusion medicine. It develops and manufactures biologics to treat chronic and rare diseases, operating an extensive plasma collection network and advanced production facilities worldwide.

9. Community Health Systems, Inc. (NYSE:CYH)

Number of Hedge Fund Holders: 29

Community Health Systems, Inc. (NYSE:CYH) is one of the best healthcare stocks to invest in.

TheFly reported on April 12 that Truist Securities revised its outlook on CYH, reducing its price target to $3.50 from $4.00 while maintaining a Hold rating. The adjustment was made within a broader healthcare services research update ahead of the upcoming first-quarter results.

The firm highlighted generally positive industry conditions, supported by steady demand, supportive long-term trends, and a more stable reimbursement environment, including recent Medicare Advantage policy updates viewed as favorable. It also noted that the sector remains attractive due to its domestic focus, scale advantages, and defensive characteristics. Additional support comes from strong cash generation and financial flexibility, which allows continued investment, mergers and acquisitions, and shareholder-focused strategies, including buybacks and other returns.

Separately, earlier on April 1, Community Health Systems, Inc. (NYSE:CYH) finalized the sale of Crestwood Medical Center, a 180-bed hospital in Huntsville, Alabama, along with its related outpatient facilities and physician practices. The assets were transferred to Huntsville Hospital Health System in a transaction valued at $459 million before expenses.

The deal was initially announced in January 2026 and represents part of the company’s broader plan to streamline its portfolio through selective asset sales. This divestiture aligns with previously discussed strategies to optimize operations and reallocate resources, as outlined during the company’s recent earnings discussions and subsequent public updates.

Community Health Systems, Inc. (NYSE:CYH) is one of the largest publicly traded hospital operators in the U.S., providing acute care services through a network of hospitals and outpatient facilities. It focuses on delivering accessible healthcare in non-urban and regional communities.

8. The Pennant Group, Inc. (NASDAQ:PNTG)

Number of Hedge Fund Holders: 30

The Pennant Group, Inc. (NASDAQ:PNTG) is one of the best healthcare stocks.

TheFly reported on April 13 that Truist Financial analyst David MacDonald increased the price target for The PNTG to $36 from $34 and maintained a Buy rating. The update came as part of a broader preview of first-quarter results in the healthcare services sector. Truist expressed a positive view on the industry, citing sustained demand, supportive long-term trends, and improved reimbursement stability, with recent Medicare Advantage developments seen as favorable. The firm also noted that the sector benefits from its domestic scale, defensive positioning, and strong cash generation, which support continued investment, acquisitions, and shareholder-focused initiatives.

In separate news, on April 1, The Pennant Group, Inc. (NASDAQ:PNTG) completed the purchase of the property and business operations of Arbor Rose Senior Living in Mesa, Arizona, rebranding the community as Lavender Lane Senior Living. The site offers a mix of independent living, assisted living, and memory care services, including 74 licensed beds and 25 independent units. This transaction expands the company’s footprint in Arizona, particularly within the East Valley region, and supports its strategy of targeted growth in senior housing. The acquisition also reflects PNTG’s focus on enhancing service offerings while strengthening its regional presence.

The Pennant Group, Inc. (NASDAQ:PNTG) is a healthcare services company providing home health, hospice, and senior living services. It operates through a decentralized model, supporting local agencies and communities while focusing on high-quality, patient-centered care across the United States.

7. Merit Medical Systems, Inc. (NASDAQ:MMSI)

Number of Hedge Fund Holders: 33

Merit Medical Systems, Inc. (NASDAQ:MMSI) is among the best healthcare stocks to buy and hold for 3 years.

TheFly reported on April 13 that BTIG analyst Sam Eiber kept a Buy rating on MMSI while cutting the price target to $100 from $107. The adjustment reflects model revisions tied to CMS’s proposed FY27 inpatient payment framework, which includes early-stage guidance and decisions related to new technology add-on reimbursements within the medical technology space.

In other news, earlier on April 1, Merit Medical Systems, Inc. (NASDAQ:MMSI) completed the acquisition of View Point Medical, Inc. through a merger, making it a wholly owned subsidiary in a deal valued at approximately $140 million, including assumed liabilities. The transaction included an upfront cash payment of $90 million, with two additional deferred payments of $25 million each scheduled over the following two years.

ViewPoint, based in Carlsbad, California, develops imaging and tissue marker technologies used in diagnostic and surgical procedures. The acquisition expands MMSI’s oncology portfolio, particularly in breast and soft tissue tumor localization, and enhances its capabilities in minimally invasive diagnostic solutions. The company expects the deal to contribute modest revenue in 2026 while temporarily impacting earnings, with stronger financial benefits projected in 2027 as product adoption grows and operational integration progresses.

Merit Medical Systems, Inc. (NASDAQ:MMSI) is a global medical device company that develops and manufactures products used in interventional, diagnostic, and therapeutic procedures. It focuses on minimally invasive solutions for cardiology, radiology, oncology, and endoscopy markets.

6. Haemonetics Corporation (NYSE:HAE)

Number of Hedge Fund Holders: 33

Haemonetics Corporation (NYSE:HAE) is among the best healthcare stocks to invest in.

TheFly reported on April 13 that Mizuho analyst Anthony Petrone reduced the price target for HAE to $70 from $80 while maintaining an Outperform rating. The revision was part of a broader update across the firm’s medical devices and diagnostics coverage ahead of upcoming first-quarter earnings. The changes reflect lowered estimates across several companies in the sector as part of the same review process.

In a separate movement, on March 30, Haemonetics Corporation (NYSE:HAE) announced that the U.S. Food and Drug Administration approved an expanded indication for its VASCADE MVP XL venous closure system. The updated label allows use with larger procedural sheaths, including 10–14F inner diameter and up to 17F outer diameter devices.

This expansion enables compatibility with advanced cardiac procedures such as pulsed field ablation and left atrial appendage closure used in treating atrial fibrillation. Regulatory approval was supported by results from the AMBULATE EXPAND clinical trial, which evaluated safety and effectiveness in patients undergoing large-sheath procedures and reported no major or minor access-site closure complications along with faster mobilization times. The update broadens the system’s clinical utility in electrophysiology and interventional procedures, removing the need for sheath downsizing and improving procedural efficiency across hospital and outpatient settings.

Haemonetics Corporation (NYSE:HAE) is a medical technology company focused on blood and plasma management solutions. It develops devices and software used in blood collection, transfusion, and therapeutic apheresis to improve safety, efficiency, and patient outcomes in healthcare systems worldwide.

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